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Everything as a Service?: Government and the Cloud

From “cloud first” to “cloud smart,” public-sector agencies have been moving systems off-premises for years. CIOs reflect on what is in the cloud, what can be and what it takes to make the leap.

silhouette of person standing in front of a blue screen with a digital image of a cloud
State and local IT leaders are galloping toward the cloud, whether they know it or not.

Thirty-seven percent say they moved on-premise infrastructure to public cloud this past year, according to the 2022 CompTIA Public Technology Institute (PTI) State of City and County IT National Survey. And 32 percent said that migrating systems and applications to the cloud will be a top priority in the next two years.

Yet much of state and local cloud adoption still goes unrecognized as such, said Alan Shark, vice president of public sector and executive director at PTI. “People say they’re not in the cloud very much, and when you start asking questions, it turns out that they’re very much in the cloud.”

Another stat from the CompTIA survey helps explain why. Among public-sector IT leaders, 80 percent said they began using a new software as a service this past year. They may not be closing down data centers or signing contracts with cloud service providers, but those SaaS applications by and large reside in … the cloud.

Taken together, formal migrations “to the cloud” and adoption of cloud-based SaaS indicate a steady shift in IT resources: away from on-prem legacy solutions and toward the cloud. “It’s continuing to gain traction,” Shark said.

In Utah, for example, the building that housed the state’s main data center is slated to be demolished, and CIO Alan Fuller is seizing the moment to jump-start his cloud migration. “We’re hoping to get better scalability, elasticity, security, redundancy and lower cost,” he told GT at the NASCIO Midyear Conference in May. “We have a multi-vendor cloud strategy and we want to move as many services and applications as we can from on-premise to the cloud.”

Of course, different government entities are moving at different paces. Some municipal IT leaders have jumped in with both feet, moving all or nearly all their civic functions to the cloud. For others, the going has been slower. Some wrangle with the shift from a capex to an opex spending model. Others face challenges related to personnel or to the phasing out of physical data centers.

Here, a range of state and local leaders help to paint a picture of the state of cloud adoption: the early wins, and the challenges yet to be faced.


Arizona state CIO J.R. Sloan’s IT organization is well along on its cloud journey. “In 2017 we introduced our ‘cloud first’ policy and that started a countdown for us to exit our data centers and adopt cloud technology,” he said.

The push came from a Deloitte assessment, which found in part that the state could uncover a lot of savings by consolidating its data center investments. Through cloud migration, “we could avoid a $15 to $30 million investment that would have been necessary just to keep our primary data center facility going.”

The state subsequently demolished its primary data center. (The site is now a parking lot.) Sloan reports that 80 percent of that activity moved directly to the cloud, and an additional 5 percent migrated to a shared data center with a much smaller physical footprint.

In the process, the IT team identified about 96 “data centers” across state agencies, including everything from formal data centers to servers running in spaces under desks. Ninety-two of those have since been decommissioned, with only a few outliers kept online.

People say they’re not in the cloud very much, and when you start asking questions, it turns out that they’re very much in the cloud.
“I have one agency that needed an exception to our policy because they have tape backups that they are required to be able to continue to access, to fulfill public records requests,” Sloan said. “Over time, that will go away as the retention schedule for what’s on those tapes expires. But until then, they still need to be able to physically access that.”

In order to ensure the push to cloud aligns with specific agency needs, the IT team has established relationships with multiple cloud service providers, including Amazon Web Services, Microsoft Azure, Google Cloud and IBM’s Z Cloud.

The way a particular agency’s infrastructure has matured over time influences which cloud option is best suited for their needs. The child protection agency, for example, had already replaced an aging case management system with a solution that was based on Microsoft Dynamics. “That went into the Dynamics 365 cloud,” Sloan said. “We’ve allowed the agencies to have a voice in selecting the cloud providers that best meet their needs.”

It shouldn’t come as a surprise that Sloan makes a strong case for the benefits of cloud adoption. As government services and data shift to the cloud, he said, “you inherently gain access to scalability and elasticity, as well as a whole set of feature functions that you don’t inherently have in your current on-premise data center environment.”

There’s a benefit on the personnel side as well. “You get people out of having to do the managing, the administration, all the care and feeding for physical servers. Now the same number of people are able to do more things. They have more time to put into more valuable activities,” he said.

One big adjustment has been the shift from capital to operational budgeting. Here, Sloan advocates for a gradual approach. “It takes time. If you try and flip a big switch, there can be some real challenges, depending upon where you are in your capex cycle,” he said.

“If you’re not at the end of a capex cycle, you potentially end up having duplicate costs,” he said. “So we work with our people to plan ahead. We will say: ‘You’re not going to be buying new servers the next time this comes around, so if you’re in year two of your five-year server cycle, plan now. You’ll need to make the transition when those are up on their life cycle.’”

Text that says $15M to $30M: Arizona's potential cost avoidance by moving to the cloud instead of investing in its primary data center


While the Louisville Metro Government is fairly mature in its cloud journey, some of the biggest work is yet to come.

The city has its office productivity tools and online collaboration tools in the cloud, along with an e-signature platform and a records request tool. Next up: enterprise resource planning for human capital management and finance, followed by public safety.

“We will have a big ERP system launching here the first week of October, and right on the tail of that, probably in late January or early February, we’re doing a major public safety systems swap-over to cloud,” said CIO Chris Seidt.

While the transition has gone smoothly, Seidt is candid about the bumps he’s hit along the road, and the need to manage thoughtfully through the details of a cloud migration. When subscribing to cloud services, for example, “it’s important to pay close attention, to ensure you are subscribing to all of the things that you need,” he said.

Because there may be different tiers of subscription models for different cloud services, “you really have to look carefully at what is included in that, because it may not include all of the pieces that you would need as an organization in order to maintain your security posture, in order to gain access to functionality,” he said.

In fact, Louisville initially undersubscribed for its office productivity suite. “It lacked some of the practical security aspects that really needed to accompany it,” Seidt said. “If you stepped up a tier, a lot of those security tools were just included. Of course, there’s a cost jump there too.”

In addition to working through those technical details, Seidt has also focused heavily on change management.

One big barrier is “staff willingness to go along,” he said. “I’ve got a couple systems engineers that have been with me for decades, and now we’re asking them to do ‘cloud.’ So one of the first steps was to make sure people got comfortable. When people are worried about losing their jobs, you have to get out ahead of that. We certainly didn’t go into our cloud journey looking to reduce our headcount. If anything, we wanted to repurpose it.”

To that end, the city’s cloud journey has included not just messaging about the virtues of cloud, but also training to reskill IT for the task that lies ahead. Seidt said he’s quadrupled the training spend since 2018, in an effort to upskill staff for the cloud transition.

“When you let them know that you’re willing to train them in those new skill sets, it makes them more engaged,” Seidt said. “Some of our systems guys are our biggest champions now, because they see the bigger picture.”

While others work with multiple cloud providers, Seidt for now is focused solely on AWS engagements. With a single provider, he said, he can more easily control and manage his cloud resources.

At the same time, Seidt has been working with others in the city to repurpose the data center space he’s no longer using.

“In a lot of city governments, the data center serves as more than just a place to house compute and storage. It may also have your network core redundancy. It may also have fiber terminations for municipally owned fiber. There’s a lot of other things that live there,” he said.

As he moves to decommission compute and storage, he’s looking for opportunities to refresh the HVAC systems for downsized demand and potentially repurpose those spaces for other uses.

As for the shift from capex to opex spending, Seidt said good communication is the key to success. “It does require a lot of cooperation with your chief financial officer and your elected officials, making sure that they understand the business case for it and the benefits that come with it,” he said.

Text that says 4X: Louisville has quadruples its spending on training since 2018 to upskill staff for the cloud transition


In Baton Rouge, La., the shift to cloud has come at a slower pace, in part by necessity (there’s lots of other work to do) and in part by design (IT leaders want to be sure they’re on the right path).

“We have been slow to embrace the cloud,” said Director of Information Services Eric Romero. “We’re so busy here, it is hard to find the time to get up to speed, to learn the newer technologies and to get to that comfort level.”

The city has nonetheless already shifted a few applications to the cloud, including 311, permitting and a nearly billion-dollar road program that’s leveraging cloud-based tools for project management. Romero said he’s already seeing the benefits of a modernized approach. “The upside is certainly that it’s less taxing on my department, my resources, my staff,” he said.

Still, Romero has questions. He’s particularly concerned about data portability, or the lack thereof. “Once all the data is in the cloud, how do we get it out of the cloud in a way that we can either use it for historical purposes or convert it for use in another system?” he said, noting that his sense is that cloud service providers don’t want to make this easy.

He said he’d like to see more data on cloud reliability, too: downtime metrics and the like. He’d also like some assurance that a cloud provider would be able to respond quickly to an urgent need.

“When we have an issue, something that might not seem critical to them might be extremely critical to us. If we had it in-house, my guys would be working on it 24 hours a day until it got resolved,” he said. “That might come through with the contract process, but will they really understand it?”

In a lot of city governments, the data center serves as more than just a place to house compute and storage. It may also have your network core redundancy. It may also have fiber terminations for municipally owned fiber. There’s a lot of other things that live there.
With so many unknowns, Romero is taking a deliberately cautious approach. “It’s almost an application-by-application process,” he said.

At this point, when he does make a move, it’s typically a matter of cloud by necessity. “For example, we’re running an old version of Exchange for email and every time that we get a patch from Microsoft, we have issues getting the servers back online,” he said. “We just finally came to the conclusion that we had to move.”

In tandem with such efforts, Romero has been communicating with folks on the budgeting side to ensure a smooth transition to opex as needed.

American Rescue Plan money is helping bridge the gap between capex and opex for the moment, but eventually those new cloud-based contracts will come due again — maybe two or five years down the road — and Romero said it will be important to have solidified the funding model in support of that spending.

“I was very upfront with our finance folks and the administration here, saying: ‘These are my needs … and we are going to use ARP funds for this, but we’ve got to address the budget or else in five years we’re going to be cutting these services.’”

In the long run, he said, changes to the budget process and incremental steps toward the cloud together will put the IT team on a better footing. Cloud will ultimately lower the management burden, freeing talent to tackle higher-level tasks. And a move to the cloud could also make it easier to hire the people he needs.

“As candidates come in and they see that you’re not fully embracing the cloud, that can be a detriment to their considering the position,” he said. Seen in this light, cloud becomes increasingly a must-have for state and local governments looking to attract the best and brightest in a highly competitive talent market.

More to the point, Romero describes cloud as an inevitable technological evolution.

“We know that this is coming. We’re seeing more and more: not just software applications, but solutions that are being pushed to a subscription-based model, most often cloud-based,” he said. “We know that it’s coming and at some point, we will get there.”
Adam Stone is a contributing writer for Government Technology magazine.